Why are Telecom and Technology Billings so Difficult to Understand and Manage?

Telecommunications is the second highest non-operating expense for the average Fortune 1000 firm. Small, Medium and Large businesses alike suffer expense management issue when it comes to monthly recurring cost in the telecom and technology arenas. Most organizations can reduce these expenses by three to fifteen percent on their own; however some can cut costs by 30 to 40 percent utilizing the right expertise. The key to achieving and maintaining lower telecom expenses is to understand billing infrastructure and platforms, industry drivers, technical alternatives, and effective telecom procurement and processing techniques.

 

Many organizations pay far above-market prices, over-buy capacity, fail to detect billing errors, and use less-than-optimal technologies. Compounding the problem is the extreme conservatism of most internal telecommunications organizations, in other words —there is only modest reward for cost management, but extreme punishment for any service interruptions. Hence, the “if it ain’t broke, don’t fix it” mind set stays in place. Employees expect dial tone , data and video on demand virtually 100 percent of the time… and are intolerant of any changes that risk downtime. That creates poor purchasing and negotiation skills with those in charge of procuring telecom and technology services. But that’s not the only problem. So let’s explore why telecom and technology recurring costs are so difficult to manage:

 

            The following is a general list of cost management issues faced by most organizations:

 

• Telecom bills are large (delivered in large boxes or multiple CDs), difficult to read, and often not electronic.
• Telecom vendors (local, long distance, etc.) do not have uniform formats for billing information.
• Correlating consumption (number of minutes used, etc.) to the bill is often difficult.
• Forecasting the organization’s future usage is difficult. Trunks and other services must often be ordered in advance, based on an estimate of future need.
• Internal expertise, especially for the newest available telecom offerings, may be lacking.
• Fear of change hampers some initiatives that, if implemented, could reduce expenses.
• Telecom regulations, while simpler than in the past, are still complex (certainly for the United States and increasingly for the rest of the world). For example, some organizations, such as airlines, are exempt from the U.S. Federal Excise Tax for telecommunications.
• Voice, data, and video integration continue. The billing infrastructure for these three media has traditionally been different (fixed months versus per minute, etc.). As some per-minute costs get merged into packet-based, flat- fee services, confusion over billing will undoubtedly surface.
• The telecommunications environment is dynamic. Technologies, carriers, offerings, and pricing changes are almost constant. A study done in 2010 may not apply in 2013. 

It would be logical for anyone to become frustrated or lack confidence when it comes to managing the difficulty of the above list of items in any industry. And that is understandable, but does not leave a good taste in the mouths of anyone having to digest the “mismanaged costs and unnecessary expense” appearing to the P&L’s of organizations which suffer these similar issues.

 

But that does not mean it has to continue…

Telecommunications costs can be significantly reduced in virtually every organization. Although there are frequent changes in technology, markets, carrier issues, demand, and employee requirements seem to rise continually, there are external specialists and standard solution sets that can help. By gaining external assistance or understanding the tools — whether technical, procedural, negotiations, then— the organization can make an informed, best-fit decision.

 

 

FCC Seeks Comments RE: Allowing VoIP Services Direct Access to Numbers

FCC Seeks Comments RE: Allowing VoIP Services Direct Access to Numbers & Easing Numbering Access for Other Services
 

On April 18, 2013, the Federal Communications Commission (“FCC”) proposed to streamline access to telephone numbers for Voice over Internet Protocol (“VoIP”) service providers. This proposal would change the current system, which requires VoIP providers to acquire numbers through traditional telephone companies acting as middlemen. This process generally means increased time and costs for VoIP providers trying to introduce new services. To expedite the process of VoIP companies acquiring numbers, the FCC is evaluating a more streamlined approach.
 
The FCC is seeking comment on:

 

·         whether interconnected VoIP providers should have direct access to numbers;
 
·         easing access from other services that require numbers, such as IP access to emergency services, home security systems, text messaging services, programmable appliances and telematics like hands-free cellular modems in automobiles;
 

·         the general trend and whether changes in FCC policies are appropriate with respect to the relationship between area codes and geographic regions, which has been weakened by number portability, especially as mobile subscribers move from the area where they obtained the service but continue using the number.
 
The FCC has launched a limited, six-month trial of direct access to numbers to test several technical issues related to the current proposals. Some VoIP providers, including Vonage and other VoIP providers with pending direct-access waiver petitions at the FCC, will be allowed to test direct access for 5% or fewer of the numbers they currently access through intermediaries, phased in over 6 months, and a very limited quantity of new numbers. The participating providers will report monthly on the progress of the trial, and must return the numbers if problems arise. The FCC also granted a limited waiver to TeleCommunication Systems, Inc., which provides access to E911 services for interconnected VoIP providers.
 
As previously referenced, the FCC also opened a Notice of Inquiry seeking general comment about the long-term relationship of numbers to geographic boundaries. The FCC notes that the relationship between area codes and geographic regions has been weakened by number portability, especially as mobile subscribers move away from the area where they obtained the service but continue using the number. The FCC is seeking general comment on these trends and whether changes in FCC policies are appropriate

 

LEVEL 3′S ‘UNACCPETABLE’ CALL-DROP PROBLEM RESULTS IN SETTLEMENT

Level 3 Communications Inc. will pay almost $1 million in fees and let the FCC review its service quality in rural areas.

That’s because the FCC says call rates are failing in rural areas because long-distance operators and intermediate providers are trying to cut down on the amount paid to local phone companies by using least-cost routing.

The Colorado-based carrier will make what the FCC called a voluntary payment of $975,000 to the U.S. Treasury and has agreed to pay $1 million each quarter if it does not hit new performance benchmarks.

“Basic long-distance phone calls are failing in many areas of rural America at alarming rates,” Michele Ellison, FCC enforcement chief, said in a prepared statement. “This is unacceptable.”

In addition to financial concessions, Level 3says it will do the following:

Complete long-distance calls to local phone companies in rural areas at a rate within 5 percent of what is experienced in non-rural areas over two years;
Rate intermediate providers and notify them each month of problematic routes; and
Stop using intermediate providers that do not perform well and help the FCC investigate those companies.
In a statement, Level 3 said it has pushed for “clear and measurable standards applicable to all providers, and this agreement is a solid step in that direction.”

 

Real World Perspective Differences of the Admin vs Consultant

Here you will Find Key differences in the Perspectives of the Technical Admin and that of the Technical Consultant.

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SMB IT Journal » Blog Archive » Never Get Advice from a Reseller (or Vendor) smbitjournal.com

This is general business advice that often applies to IT but is certainly not limited to that realm alone.  Outside support in IT comes from two main sources: firms who are paid (by you) to advise you and firms paid (by you) to…

Mark Himmelstein, Thomas Higgins like this

5 comments

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Thomas Higgins • Sorry, I must disagree on the Vendor side of this argument (though the reseller side is spot on). There is a big caveat to the disgreement, however. That is that you MUST get the advice from MULTIPLE competing vendors if you seek vendor advice at all. That way, the competing vendors will provide you with both the best light and worst light situations. One give you roses, the other thorns. Armed with such knowledge, you can make an informed decision on your own without the high cost of paying an outside firm. If, however, the project is of sufficient complexity and/or cost, it is often STILL better to engage firms who are knowledgeable on all aspects of all competing products to provide a tailored solution recommendation based on your needs. This solution might even be just a process change, or leverage of existing tools instead of focusing on a new tool’s capability. That is the only solution any vendor or reseller would ever talk about, for the very reasons set forth in the article.

4 hours ago• Like

Robert Stevens • it seems the client would be best served to consult with an objective third party?

3 hours ago

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Thomas Higgins • Depends on the situation, I would think. A third party is almost always expensive. It is difficult to justify that expense in all but the most critical decisions. Hence my statement about sufficiently complex and/or expensive projects justifying the expense of a third party consultant. However, I do feel most employees know their environment, corporate objectives, needs, goals, and capabilities far better than they can convey to a consultant. This tends to lead to good decisions by such employees without the additional costs for reasonably straight forward projects and needs. All such employees really need is simple answers to define which solution is a better fit, and a motivated vendor can provide all the details of what makes their solution superior. That is why only in the most complex or high cost (read high stake) projects should one consult with an “objective” third party to do a sanity check on any concerns may not have been considered. In these projects, the independent consultant is a small percentage of the overall cost and worth the additional check and balance. In most projects, however, the value added does not outweigh the costs associated from what I have seen.

As an alternative way of looking at it – how does the consultant provide an objective opinion? Do they impliment all manner of solutions to know them in and out? Or do they consult vendors and vet them until they have a good understanding of the products they are concerned about – pitting one vendor against the other until they understand the value proposition each vendor provides and the downside of each tool? I propose it is the second way, and all I am suggesting is companies can do the same thing many times without having a consultant fee on top of it all.

Note I do not discount the value of an objective third party consultation, nor the results. However, the article listed seems to advocate it for every decision instead of asking a vendor about their own product or a competing one. This seems ludicrous to me as the vendor will know their product best – as well as why their solution is better than their comptetitors. Why not ask them and then draw your own conclusions for a best fit? Complexity is one good reason. High cost/High value projects is another. All project decisions, however, does not make any sense whatsoever.

I am actually at the end of a project now where we partnered with a third party consultant to great effect – but the complexity of the project moving forward and the costs involved both up front and recurring warranted the cost of the consultant. In the end, it was the project managers who made the decision, but the consultant gathered the requirements, documented them, sent them to various vendors, and prevetted them. All things I have done on my own in the past. Such legwork is not particularly time consuming, though it can be, and really didn’t help much in the decision making process. In fact, we were the primary scorekeepers not the consultant precisely because we knew the environment, goals, objectives, etc. on a deeper basis. But they provided a needed sanity check and a stamp of approval the corporate executives desired before laying out the purchase agreement.

In a similar project of much smaller scope, the same consultants did the same type of work, and the company found it a spectacular waste of time and money because the solution they proposed based on their knowledge didn’t meet the needs and desires of the end users, despite the best effort they provided. In this case, the administrative team did the work themselves independently and came to a completely different conclusion that was discarded out of hand in favor of the consultant’s solution, End result as already mentioned, dissatisfaction. So much so they eventually went and got the solution proposed by the administrative team and now ALL stakeholders are far happier.

2 hours ago• Like

Robert Stevens • My experience has really afforded me the ability to have more leverage with the integrators and also the ability to easily identify the right vendors and solutions for projects, thus killing much of the legwork or “Heavy Lifting” a company must also absorb though their admins or procurement execs paychecks. Taking that into consideration there are instances where having a vast network of integrators, continuous involvement with those integrators and product knowledge helps us to get much better pricing and project results, we have already measured their business practices and strengths/weaknesses. In some instances the improvement has more than covered our consulting fees not even to mention the soft dollars saved in having to put our “Continuous Fires”. At the end of the day many decision makers have other things to focus on and do not want to decrypt the differences of products or vendors. Most of them cannot recall the differentiators after a few vendor meetings as they become easily overwhelmed with “Sales Fluff” and the thought process/scope can totally get lost in translation.
I agree the vendor should know their products pretty well and the differences of competitors products, But, Are They Going to be Honest about the “Key Differentiators” or become evasive about them all-together? I witness evasive behavior on a daily basis from carriers and vendors. Let’s think about this, Is Cisco going to tell you “Junipers hardware does this much better” ??
Taking Something as simple as a switch into consideration for the average business owner. Many are not able to realize the difference between a Cisco 3945 or Cisco 2800-2900 series. The first that may be apparent is the $15k price difference. Then we must consider is Cisco in their best interest and how do they stack up against other pieces of hardware from other manufacturers. These instances have allowed us to more easily identify which vendors are truly a “Best Fit” for a project based upon our “working experiences” with those vendors and our translation of their “business practices”. This is something that unfortunately more clients are not going to become aware of until they go through the “Trials and Tribulations” of working with the said vendors. which is a rarity because projects of respectable size happen within single organizations on a limited basis and ours is on a continual basis. This scenario focuses on a small piece of hardware, I am not even digging into carrier services/access, the carriers associated fiscal health and reputation, the caveats to the carrier agreements, and the list goes on. Decisions should “NEVER” be made based upon Specs and RFP Reponses. There has to be much “More Intimate Knowledge of the Vendors and Products” which is something a client simply does not have.
It seems to be counterproductive for the Consultants to not work with the administrative team, and compliment their skills and expertise/ Rather than Compete with them. I feel it is ridiculous to not work together, this behavior renders consulting dollars a “complete waste”. Because your fighting an uphill battle with internal employees from day one! This is “Counter Productive and Foolish on both parties Behalf”. A Team Identifies with one another’s strengths and combines those strengths to create positive results. I have witnessed and practiced within scenarios where the Administrative team does not really want to team with the consultant at all, they want 100% ownership of the project and feel their “Level of Knowledge” is equal or beyond that of the Consultants. This is not in the “Projects Best Interest”. We can all feel threatened at times but to Truly be innovative people must realize how another Team Members strengths can benefit everyone as a whole. And at the end of the day the “Goal is to do What IS in the Best interest of the Client”.

14 seconds ago

Robert Stevens • Believe me, the Consultant does not want the administrators job. Our goal is to continue to grow our expertise and move from challenge to challenge. This is what Consultants thrive on, It’s a Part of Our Spirit to continually build our knowledge and allow our expertise to flourish.

Disclaimer: My intention of responding to these comments are in no way malicious and “I’m Not Picking on Cisco or Admins. The goal is to address (in a public forum) the perspective differentiation of the Admin and the Consultant. Many will like one view over the other, Many are respective positive clients to work with and some are not. Practices from one Consultant to another will vary and there are several key indicators that will differentiate your experiences. The key goal and objective is to work closely with admins as a consultant and identify the strengths and weaknesses of each to “Bridge the gaps” and pull the project off to achieve “Best Case Scenarios and Results”

 

Watch “Why Data Caps Suck: The Animated Examination” on YouTube

 

Google and others petition courts to stop upholding vague patents

http://feedproxy.google.com/~r/androidcentral/~3/DSsdlLF8QPc/story01.htm

 

A Great Win for us Today!

Just closed a deal for Private fiber network with a Seattle Based Company! The Client needed drops in Seattle, San Francisco, Boston, DC, Halifax, London and Amsterdam! 

This client was struggling to find a solution with one provider on one network, They did get quotes where there was heavy resell activity and required traversing several provider networks, The client DID NOT WANT THIS. We delivered at 30% less than anyone else and kept their traffic on one providers secure and redundant network. The client is very happy and gave little resistance in signing an exclusivity/consulting agreement! 

This is where industry insider knowledge really paid off for everyone involved! Every other party that was in there was trying to sell them what they did not want. We very much look forward to serving all of their Telecom and Network services needs and Thank god they found me on LinkedIn!! 

GREAT DAY!!!! 

 

Article: Here’s the CIO Playbook for the Next 5 years

Here’s the CIO Playbook for the Next 5 years

http://www.forbes.com/sites/markfidelman/2012/10/23/heres-the-cio-playbook-for-the-next-5-years/

 

LTE RIPOFF!

The biggest market doesn’t equate to the lowest prices for 4G LTE customers in the U.S.

Despite this large market, Americans pay anywhere from two to 10 times more for LTE services compared to European countries, The New York Times revealed in an article.

Verizon Wireless charges $7.50 per gigabyte of data downloaded in the U.S., according to the research firm TeleGeography, while Europeans pay an average of $2.50. Meanwhile, in Sweden, consumers pay just 63 cents for a gigabyte.

Data plans in the U.S. often include unlimited talk, text, picture and video messages, which does cause prices to increase per gigabyte, according to Verizon Wireless spokeswoman Brenda Raney. She told The Times that having a data-only plan would allow the price to drop to $5.50, which is still over two times the European average.

Another reason for the higher prices within the states is the level of competition.

Wire Intelligence analyst Calum Dewar said in the article that Europe has the most operators selling LTE in the world. On the other hand, Verizon and AT&T were the only operators within the U.S. selling the service up until July.

3G services follow the same trend — they cost much more in the U.S.

Consumers within in the United States spent $115 per month when they bought contracts for 3G services, according to a survey by Ernst & Young. In Britain, the average cost was only $59.

People in the U.S. developed their telephone behaviors back when prices were low, while habits in Europe were developed in a high-cost environment, The New York Times said. This causes Europeans to restrict mobile phone use to reduce spending.

Americans, on the other hand, continue to take full advantage of their costly talk, text and data plans.

 

Verizon overcharges Fairfax $3.1m for phone service

Taylor Holland

Staff writer

The Washington Examiner

Verizon has overbilled Fairfax County by more than $3 million for phone service since 2006, and despite regular complaints, the billing problems remain so routine that the cash-strapped county has had to assign personnel to monitor its phone bill.

The phone company has already refunded $3.1 million to the county after overbilling it for services, but the county’s Department of Information Technology just wrote Verizon to identify 97 additional billing errors costing $190,000.

“Clearly this concerns me,” said Supervisor Pat Herrity, R-Springfield. “But looking at the bigger picture, I’m shocked at the fact that they continue to make the same mistakes. You’d think they’d be able to get it right.”

Verizon has tried to fix the problems causing the overbillings, but the errors continue. As recently as July, Verizon inflated the county’s monthly phone bill by more than $80,000, a county audit shows.

Most of the overcharges — $2.5 million of the $3.1 million since 2006 — result from Verizon consistently billing the county for services above their contract rates. Most notably, Verizon has been charging a “dial tone tariff,” a fee charged to maintain a voice line, of $15.60 per phone line instead of the contracted rate of $12.

Verizon also erroneously charged the county $343,000 in late-payment charges it didn’t owe, $154,000 for long-distance calls that were never made and $101,000 in unauthorized third-party charges that were made by people not affiliated with the county government.

“The County Attorney’s Office is currently reviewing what recourse, if any, the County has to ensure that Verizon complies with acceptable billing practices,” the county’s audit stated.

Until Verizon can correct its errors, the county will assign staff to monitor its phone bill, Herrity said.

The county’s contract with Verizon expires in 2014, and county spokeswoman Merni Fitzgerald said the ongoing overcharge problems will be taken into consideration when the county considers renewing the contract.

The billing issues are in addition to the problems the county has hadwith Verizon’s oversight of the county’s 911 centers. The emergency phone lines failed during a destructive storm this summer, leaving more than 2 million people unable to reach emergency personnel.

Verizon spokesman Kevin Irland said the company works closely with Fairfax County to address concerns, and will continue to investigate and resolve any issues with bills when adjustments are warranted.

“The good news is they’ve cooperated during this process,” Herrity said. “Now they just need to get their bills right the first time.”